U.S. Border Control

End illegal immigration

By Jim Ludwick
March 18, 2006

In his recent State of Union speech, President Bush said, "We hear claims that immigrants are somehow bad for the economy - even though the economy couldn't function without them." Put aside for the moment the fact that Bush blurred any distinction between legal and illegal aliens. What is the true economic impact of illegal immigration?

In January of last year, Bear Stearns issued its report, "The Underground Labor Force is Rising to the Surface." The report stated that we have 20 million illegal aliens in the U.S., more than double the 9 million that the Census Bureau estimated. Bear Stearns stated that one of the reasons for the Census Bureau's undercount is that 5 million illegal aliens are paid under the table and, as a result, do not show up in the normal demographic data that the bureau uses to calculate population.

According to Bear Stearns, those 5 million illegal aliens cheat the government out of over $35 billion a year in income taxes. At the same time, they receive $30 billion a year in government largess.

In December, the Milken Institute released a study entitled "The Los Angeles Economy Project." The study was done in partnership with the City of Los Angeles and County of Los Angeles. What they found was that 15 percent of the workforce (680,000 workers) were paid under the table. That is just in LA county alone. They estimate 61 percent are illegal aliens.

The 680,000 workers cheat the government out of $2 billion a year in taxes. Bear in mind, LA County Supervisor Michael Antonovich estimates that illegal aliens cost LA County about $1 billion a year in just health care, criminal incarceration and public education.

The authors of the Los Angeles Economy Project concluded in Section 9 of the report:

Given this large number of informal jobs and the continuing practice by many employers of avoiding legally mandated payroll taxes, there is a real risk that a steadily increasing number of employers will adopt this illicit labor management practice in order to remain competitive with the marketplace.

The region's underground economy, now estimated at an $8.1 billion payroll annually, siphons off vast sums of money as workers and employers fail to make payments to Social Security, workers compensation, health insurance and other social safety-net programs.

Over the long term, this trend portends a downward spiral for the regional economy as the low-wage labor force continues to grow, the costs of informal employment are shifted to other segments of society and the social safety net becomes more precarious.

It is my belief that even if an illegal alien is carried on the official payroll, most are poorly educated and unskilled, and as a result do not earn enough money to be required to pay taxes. That is particularly true here in Oregon, where we do not have a sales tax.

Can anyone make the case that the immigration of millions of people into America each year who pay little or nothing in taxes but receive billions of dollars per year in government services is either sustainable or good economic policy?

Consider two of the many programs that are negatively impacted by present immigration policies: public education and health care.

Using Census Bureau data, it is estimated that 96 percent of the increase in enrollment in public schools is due to immigration. If 96 percent of the increase in enrollment is of students whose parents contribute little or nothing in taxes to support their education, something has to give. Either programs and teachers must be cut, or taxes raised on those American citizens who pay taxes.

Over the past two years, there has been an increase in the number of English Language Learners (ELL) in the McMinnville School District from 772 to 1,138. A 32 percent increase! Any wonder that the school district has put a $96 million bond levy on the May ballot?

Last year, the Salem School District spent over $7 million on ELL programs but only $668,000 on the Talented and Gifted Program (TAG). What that amounted to was an extra $2,500 per ELL student and a paltry extra $131 per TAG student.

Next year's budget is even worse: A 14 percent increase in ELL funding and a decrease in spending on the TAG program of 6 percent. It is obvious where its priorities are. Keep in mind that, nationally, over 60 percent of ELL students do not even graduate from high school and over 90 percent of the TAG students not only graduate but also go on to universities.

Last year, President Bush released $1 billion to reimburse hospitals in the Southwest for the free health care that they gave illegal aliens. California Congressman Dana Rohrabacher estimates that the $1 billion is only about 10 percent of the actual cost to those hospitals and doesn't include state or county money spent on illegal aliens.

In the spring edition of the Journal of American Physicians and Surgeons, Madeleine Cosman wrote an article, "Illegal Aliens and American Medicine." Cosman chronicled that over the past 10 years, 60 California emergency room hospitals have gone bankrupt and closed their doors due to unreimbursed medical care given to illegal aliens. Twenty-four more hospitals are on the verge of bankruptcy, leaving many American citizens without nearby medical care.

Last month, it was announced that the Oregon Department of Human Services is $172 million over budget just five months into the biennium. DHS administers the Oregon Heath Plan. Despite being $172 million over budget, DHS sends out employees on Saturdays and pays them overtime to attend events that, by agreement with the Mexican consul general, are only open to Mexican nationals. At these events, DHS shows Mexican nationals how to access Oregon state benefits.

The fact is that current immigration policies that allow in 2 to 3 million legal and illegal immigrants per year are overwhelming our public schools, our public health systems, the criminal justice system (about 30 percent of the inmates in federal prison are noncitizens), the livability of our communities and eventually our natural environment.

We need to return to immigration policies that benefit us as a people and as a country.

We need to end illegal immigration, we need to return to our traditional immigration levels of 300,000 legal immigrants per year, and we need to regain control over our borders.

Jim Ludwick is co-founder and president of Oregonians for Immigration Reform.